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NEW YORK — In the decade since the Sept. 11 attacks, lower Manhattan has been transformed. Once the physical financial center of the country, the area has become largely an upscale residential neighborhood.

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The transformation of Wall Street results in part from the terrorist attacks, but it also reflects sweeping changes in the structure of the stock market that have come with new technology and regulations.

"If you just looked at the Dow, you'd think that nothing much had changed over the past 10 years, but nothing could be further from the truth," says Louis Pastina, the head of trading floor operations at the New York Stock Exchange.

As Fidelity Investments, Japanese bank Nomura and others decamped for New Jersey and midtown Manhattan, chains like Whole Foods, Sephora and Bed, Bath & Beyond moved in. Nearly one-third of the residential buildings in lower Manhattan were built in the last decade.

Traders, who once had sidewalks largely to themselves after 7 p.m., now are likely to see couples walking their dogs along the area's narrow streets. And the former JP Morgan building, a landmark across the street from the exchange building, is soon to be occupied by a high-end retailer.

Back in early September 2001, the Dow Jones industrial average had just fallen below 10,000. Much of the financial data that powered the stock exchange flowed through servers in a Verizon building adjacent to the World Trade Center complex. Tourists could walk in the front door of the New York Stock Exchange and up to a galley to watch the trading.

The building itself sustained no damage when the Twin Towers fell, and trading resumed Sept. 17, six days later. But the exchange's home was now considered a prominent target. The visitor center was closed, and the cables and wires that fed the exchange were rerouted and reinforced.

Already, advances in technology meant human traders weren't always necessary to make decisions. Nasdaq had long operated its market without traders screaming orders across a trading floor. And, in early 2001, the Chicago Mercantile Exchange — which specializes in commodities and options — had taken another step into the future by allowing algorithmic trading, which lets computers decide when to buy and sell based on mathematical models. The New York Stock Exchange soon adopted the model as well.

But the biggest change came in 2005, when the Securities and Exchange Commission extended a rule that required brokers to fill customer orders at the best available price. Before then, brokers just had to find the best price at the New York Stock Exchange.

The new rule led to faster trading speeds as additional exchanges competed to fill each order. Some investing tactics still can complicate the process. But, in the simplest explanation, an investor who wanted to buy 300 shares of General Electric at the market price before this rule change might have seen his order go unfilled for minutes or longer because of its small size. It would be lumped with other orders for GE shares until the total rose to, say, 10,000 shares. Then the aggregate order would be filled, regardless of how much the stock's price fluctuated in the meantime.

After the rule, an investor could have his order displayed both at the New York Stock Exchange and at smaller, faster regional markets that would more immediately handle small transactions on their electronic-only exchanges, including New Jersey-based DirectEdge and BATS, an exchange based in Kansas City, Mo.

The cost of each stock transaction soon plummeted from an estimated average of a few cents in 2001 to less than 0.03 cents in the first three months of this year. Another result of change was a wave of consolidation among exchange operators that includes the purchase this year of NYSE Euronext, the company behind the New York Stock exchange, by a German company called Deutsche Borse.

Lower costs in turn let high-frequency trading take hold. This strategy uses mathematical models to make thousands of buy and sell orders each day, in search of gains as small as a penny. This is different from algorithmic trading in that high-frequency traders typically sell all their stock at the end of each trading day and go home holding only cash.

"This is something that was just not possible 10 years ago," says Irene Alridge, a partner at ABLE Alpha Trading and the author of "High-Frequency Trading: A Practical Guide to Algorithmic Strategies and Trading Systems."

And high-frequency trading made daily volumes soar because big investors could now easily trade huge numbers of shares at a very low cost. An average of 1.2 billion shares traded daily on the New York Stock Exchange in 2001. This year, 4.3 billion shares have changed hands each day on average, according to data provider FactSet.

But some investors feel high-frequency trading opened the stock market to manipulation.

Their concerns were stoked by the so-called "Flash Crash" in May 2010, when a mutual fund sold a large batch of future contracts of the Standard and Poor's 500-stock index using a computer program that pushed buyers out of the market by selling without regard to price or volume, according to an SEC report. High-frequency traders piled on and, at its worst point in the day, the Dow was down by nearly 1,000 points, though stocks made up more than half their losses by the close.

In response, the SEC adopted so-called circuit breakers that halt trading if prices on any of the 500 stocks in the Standard and Poor's 500 index or the 1,000 stocks in the Russell 1000 index move 10 percent or more in five minutes.

Circuit breakers were also put in place for the most heavily-traded exchange traded funds, a class of mutual fund known as an ETF that trades all day like a stock. For individual investors, the growing popularity of ETFs may be the biggest change since Sept. 11. Now, anyone with a brokerage account can buy and sell timber, bet on the volatility of the market itself or buy funds that offer the double inverse return of daily oil or gold prices, among others.

Meanwhile, in 2010 the New York Stock Exchange opened a 400,000-square-foot data center 35 miles from lower Manhattan, in New Jersey. The new building functions as a virtual trading floor, processing billions of trades a day in as fast as a millisecond.

"The exchange has done an excellent job of diversifying their operations out of lower Manhattan and off the island of Manhattan completely," said Dick Grasso, a former CEO of the New York Stock Exchange who left in 2003.

Technology drove the change, but the distance from lower Manhattan added a sense of security.

On the floor of the exchange, constant reminders of Sept. 11 remain. Many traders must now go through security barriers and x-ray machines under the watch of armed officers.

"I have to pass through every type of security every day, and it reminds me every day of what happened," says Ben Willis, the director of floor operations at Sunrise Securities. "I'm not allowed to forget it, even if I could."

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